Catagory:Food

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Silent, But Not Deadly
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Mandatory Bioengineered Food Labeling Rule Went Into Effect on January 1, 2022 – Are You Ready?
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M&A in Food and Agribusiness Companies: What Your Diligence List is Missing
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Disclosure of Sugar Content on Nutrition Label Dooms Plaintiffs in “Cane Juice” Case
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Federal Court Denies Request to Consolidate Nationwide Baby Food Heavy Metal Cases
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Intellectual Property Basics for the Food Industry

Silent, But Not Deadly

By: Rasheem M. Johnson

Summary: In a case alleging a failure to disclose the presence of toxic heavy metals in baby food, a California federal judge granted in part and denied in part a motion to dismiss. The judge found that plaintiffs have Article III standing and that their cause of action for failure to disclose is not preempted by Federal law.

Key Takeaways: In In re Plum Baby Food Litigation, plaintiffs allege that Plum PBC fails to disclose that its baby food products contain, or have a risk of containing, arsenic, cadmium, mercury and perchlorate. According to Plaintiffs, Plum uses deceptive, unfair and false labeling to obscure the potential presence of toxic metals in its baby food products and charge a price premium for what is labelled and advertised as high quality organic healthy baby food.

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Mandatory Bioengineered Food Labeling Rule Went Into Effect on January 1, 2022 – Are You Ready?

By: Amy Wong

Summary: In 2018, the U.S. Department of Agriculture’s (USDA) Agricultural Marketing Service (AMS) implemented the National Bioengineered Food Disclosure Standard (NBFDS). While some food companies have voluntarily complied with the NBFDS since 2018, the new regulations make compliance mandatory as of January 1, 2022.

Key Takeaway: The NBFDS is an extensive marketing standard with which every regulated entity should become familiar.  While the USDA does not have authority to issue a recall or impose civil penalties for violations of the NBFDS, the AMS could initiate an investigation and publicly publish the findings of its investigation.  It is also possible that States will adopt the same or similar requirements and impose remedies for violations of their standards, such as damages, penalties, injunctive relief, and attorney’s fees.

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M&A in Food and Agribusiness Companies: What Your Diligence List is Missing

On 6 November 2021, Kellen Holgate moderated a presentation with speakers Jonathan Cohen, Kari Larson, and Brandy Sargent at the American Agricultural Law Association (AALA) Conference on the topic: “M&A in Food and Agribusiness Companies: What Your Diligence List is Missing.” AALA is a source for information and discussion on laws and public policies affecting agriculture and food, while providing educational programs and member engagement with leadership, service, and networking.

The discussion centered on areas that sometimes are missing from general mergers and acquisitions diligence, such as regulatory food compliance, insurance, and real property and water, as well as unique issues raised in food and agriculture transactions in the financial, legal, insurance, environmental, and corporate formation areas.

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Disclosure of Sugar Content on Nutrition Label Dooms Plaintiffs in “Cane Juice” Case

By: Matthew G. Ball

Summary: Eastern District of New York dismisses claims that labeling of Whole Foods’ Oats & Flax Instant Oatmeal is false and misleading as to sugar content

Key Takeaways: In Warren v. Whole Foods Market Group, Inc., No. 19-CV-6448 (RPK) (LB) (E.D.N.Y. Dec. 3, 2021), two plaintiffs who purchased Whole Foods’ 365 Everyday Value brand  Oats & Flax Instant Oatmeal alleged that the product’s labeling was false and misleading under New York’s General Business Law because (1) they believed that the use of the term “dehydrated cane juice solids” referred to a fruit juice, rather than sugar, and (2) a stamp on the product that said “whole grains” misled them into thinking that the oatmeal contained only whole grains.  The Court granted the motion to dismiss on all claims.  The Court noted that the nutrition label on the back of the product clearly disclosed the sugar content, there were no representations on the front of the product that the oatmeal was “sugar-free,” “low in sugar,” “without added sugar,” or anything similar, and, in light of that, the Court was unwilling to conclude that a reasonable consumer would be misled given the totality of the labeling. The Court also found that plaintiffs offered no reason why a reasonable consumer would conclude that “cane juice” meant “fruit juice.”  Similarly, the Court found that no reasonable person would conclude that the entirety of the product was composed only of whole grains, given, among other things, the actual stamp-at-issue read “100% Whole Grain – 18g or more per serving” immediately conveying that the whole grains make up a portion of each serving and the product name itself disclosed a non-grain ingredient, flax.  At least in the Eastern District of New York, a reasonable consumer is not permitted to focus on one area of labeling to support an implausible interpretation of the labeling as a whole. As the Court stated, the “analysis begins with the front of the box and ends on its back.”

Federal Court Denies Request to Consolidate Nationwide Baby Food Heavy Metal Cases

By: Amy Wong

Key Takeaway: Courts are reluctant to centralize industry-wide cases involving competitors as it rarely promotes judicial efficiency and complicates discovery. For now, the baby food cases will proceed in their respective forums.

The Judicial Panel on Multidistrict Litigation (JPML) has denied a motion to centralize and consolidate 38 lawsuits pending in 10 districts against baby food companies alleging that the companies knowingly sold baby food products containing heavy metals (arsenic, lead, cadmium, and mercury), and falsely marketed these products as healthy and as not containing harmful ingredients.  In re Baby Food Marketing, Sales Practices and Products Liability Litigation, MDL No. 2997, 2021 WL 2369296 (JPML, decided June 7, 2021).

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Intellectual Property Basics for the Food Industry

By: Chris Vindurampulle

Summary: This article serves as an ‘IP check list’ for food sector business – providing detail on common forms of IP protection that can be used as a basis for building a strong commercial strategy.

Key Takeaways: The food sector is highly competitive and fast moving. The rate of change of consumer preference should not, however, diminish the importance of IP protection for food businesses. In contrast, it is clear that some of the world’s most recognised food businesses strategically leverage IP protection to ensure market exclusivity and dominance. For smaller businesses, understanding and developing an IP strategy can be useful as risk minimisation tool for building the foundations to increase scale.

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